Markets Protect the Environment Better Than the State

Not only that, everyone would benefit, people, plants, and animals alike.

by Fred Smith and Iain Murray
April 20, 2017

As Joseph Schumpeter noted, free markets had a good first century (the 1750s to 1850s). A market economy produced massive improvements in the quality of life, and that gained it general legitimacy. But, as he also warned, as wealth increased, increasingly markets and the prerequisite institutions for markets to exist (specifically property rights) came under attack.

Markets were good at producing wealth but, if tweaked by political intervention, would achieve even more benefits. Progressives in the United States and socialists in Europe championed political control of markets and, perhaps more strategically, blocked efforts to allow markets to expand into new areas of concern.

Those policies are now being reconsidered, but the one area where many, perhaps most, still believe only government can operate is that of environmental protection. This essay argues that classical liberals should challenge this view and seek to evolve a free market envir…